But that appears not to be the case with the pension plan for MPs and senators.
Buried deep in a Treasury Board report, charts show the government has made an "Actuarial liability adjustment" to parliamentarians' pension plan in each of the last three fiscal years for which data is available.
Pension funds undergo regular actuarial tests to ensure there's enough money to cover all the pensions promised to members of the fund. When the answer is "no," somebody needs to come up with extra cash to fix the situation.
According to government reports, since 2005-06, the federal government has made $7.5-million in such payments to the pension plan for MPs and senators.
Changes to the pension plan are expected to be introduced as early as next week, as the government prepares to make adjustments to public sector pensions as promised in its spring budget.
There are actually two accounts for parliamentarians' pensions: the Members of Parliament Retiring Allowances (MPRA) and the Members of Parliament Retirement Compensation Arrangements (MPRCA).
One reason for this is that the tax code allows members of a registered pension plan to accrue a maximum two per cent of their salary per year of service in their pension fund. Since MPs and senators actually get three per cent per year, a second account was needed to deal with the "overflow" for tax purposes.
Also, the first account is used only for pension contributions on a maximum salary of $148,000, anything beyond that basic MP salary goes into the second account, such as the contributions to cover extra stipends paid to the prime minister, leader of the Opposition and other MPs who hold cabinet positions or other additional duties.
The two accounts together represent the pension fund.
Who pays what?
By looking at these charts, you can also see the full picture of who puts what into the pension fund.
In 2010-11, for example, MPs and senators put $4.5 million of their own money toward their nest eggs. Taxpayers, in their role as "employer," contributed $26.7 million.
Not all private-sector employers match employee pension contributions — and most that do will only contribute on a dollar-for-dollar basis.
That, however, doesn't offer the complete picture.
The money in the parliamentarians' pension plan isn't actually invested anywhere. It sits in the Public Accounts of Canada without earning any interest.
So, Parliament years ago passed legislation assigning 10 per cent interest to the account each year — regardless of what happens in the markets. (And, since the interest is compounded quarterly, it actually works out to an effective rate of 10.38 per cent.)
In 2010-11, that amounted to $83.4 million. That means MPs and senators used $4.5 million of their own money and $110.1 million of taxpayer dollars to save for their golden years — and even then needed to add $600,000 to make the fund actuarially sound.
What isn't clear in the current debate over parliamentary pensions, and will be important to watch in the coming days, is if MPs are talking about moving to a 50-50 split when it comes to just contributions — or when that interest is factored in as well.Suggest a correction